Where to Go after the Elections

Marco Rubio in his acceptance speech talked of exceptional America, and in those few minutes capsulated what most Americans feel about their country, a country where hard work and dreams still mattered.

The challenge facing Republicans and conservatives are two fold. The first is one I have already mention in a previous blog, that the Republican Party don’t have the complete loyalty of the Tea Party and conservative grassroots. The second challenge is that there is no margin for error since as Dick Morris, the father of triangulation in the 1990’s, has already observed, there can’t be any triangulation of the big issues like healthcare, extending the Bush’s tax cuts as well as cap and trade.

The first challenge will be settled when the Republican hierarchy and the grassroots realize that their objectives are the same. Most of the Republican hierarchy are conservative at heart and there is a new set of leaders who understand that they have only been given a trial run before 2012. Young leaders like Eric Cantor and Paul Ryan are in the van guard of a new Republican Party and the future of the Party rests in their ability to wrest control from the old Guard while incorporating many of the new representatives elected as a result of the Tea Party movement.

Another aspect is that the Tea Party may be the rebellion of the investor class who see their future being slowly strangled by Obamanomics and their children future wiped out. Rubio spoke of this in his speech when he observed that in other nations, one status is determined by birth whereas in America, one status is determined by hard work and risk, but this is threatened by Obamanomics.

This leads us to the second point, the Republicans must be the Party of opportunity and liberty. It needs to recapture the vision of Marco Rubio, an America where dreams becoming reality is still possible. While there are elements of healthcare reform that both Parties can agree on, just as portability of insurance from work place to work place as well as protection for those with pre-existing conditions; the majority of the healthcare bill recently passed is based on the premise that only the government should provide health care and the private sector or what is left of it after 2014 are merely vehicles for the government to provide health care “for all.”

Obamacare must be repealed and the whole process begun all over. It should be noted that in the 1990’s, there were Democrats who supported the concept and expansion of free market reforms just as Health Saving accounts, showing that there were bipartisan support for reforms that moves us away from complete government control of health care!

Republicans need to remind voters that the extreme policy of Obama represent a break from past bipartisan support for a more hybrid, market approach that would lower health care costs and open up new avenues for individuals and small companies to buy insurance!

Another issue where no compromise can be brooked is extending the Bush’s era tax cuts. First thing to understand is that not extending the Bush tax cuts is supporting a tax increase. Extending the tax cuts only for a select Americans at the expense of others is supporting a tax increase for many small businesses and productive Americans. Extending Bush’s tax cuts is not a tax cut since these cuts are already law. No one taxes are being cut.

Is there support for extending the tax cuts? The majority of Americans understand that raising taxes is not smart economics and even the most hardened Keynesians know that to raise taxes in a weaken economy is counterproductive. Oregon Democrat Ron Wyden actually sponsored a tax bill with retired Senator Judd Gregg that would have lowered marginal tax rates on business and individuals. While the bill is not perfect, it is a good beginning point to talk taxes. If Obama vetoes extending the Bush tax cuts so he can continue his class warfare into 2012, then pass Wyden-Gregg and let him veto that as well. (Note the bipartisan Fiscal Commission report on reducing the deficits makes Wyden-Gregg one of their options for tax reforms. This adds to the bipartisan nature of reducing marginal tax rates as important to future economic growth. It is also a rejection of Obamanomics.)

The point that needs to be made is that there is a bipartisan free market policy ready to be made on key issues just as health care, taxes, and the budget. We are not talking ancient history but just a decade ago when Democrats were willing to allow market reforms be part of long term solution and it is the political left of this country that are blocking true reform.

Over the past two decades, conservatives have outnumbered those on the left by a nearly 2 to 1 margin with conservatives and moderates evenly split. 80 percent of Americans either hug the center or are on the right. This past spring, the Pew Center noted that by a 3-4 to 1 margin, Independents and Republicans considered socialism not a good thing, whereas as many Democrats considered socialism okay as do not. So with 80% of Americans opposing European socialism that is favored by the Democratic left, who is the true center?

Over the next six months, the Republicans can’t just be opposed to the Obama agenda but instead be for a growth agenda. The Obama administration is now banking on the Feds to “slowly inflate” the economy to spur growth and in the process rejecting more market approaches. The Feds game plan is a plan designed by an administration and Federal Reserve that is standing between a rock and hard place. Unwilling to move forward on actually cutting the budget or even keeping tax rates where they are, the Obama administration have no more cards. The American People are not about to tolerate any stimulus plan after seeing the failure of past stimulus over the past two years. The markets are already rebelling against the latest Fed attempt to ease as Gold shoots up in price and other nations financial ministers warn of currency wars. The Administration has no choice but to move away from Obamanomics.

Finally, we need to change the narrative about the results of Obamanomics. The Obama case rests on the mythology that they saved us from a Depression. The passing of the stimulus bill, the takeover of GM, the refusal to extend the Bush’s tax cuts, increasing spending, and the devaluing the dollar did not save us from a Depression; it delayed the recovery. If Obama and the Democrats didn’t pass a massive health care bill, actually extended the Bush’s tax cuts, passed a small stimulus (or you felt obligated to pass a stimulus plan), and quit talking about passing a cap and trade bill to reduce greenhouse effects, Obama would have an economy humming on all cylinders. We might even have caught up to the Germans, whose unemployment rate is the lowest they've had in 18 years!

Finally tell those Democrats who survived the Pelosi engineered massacre of their ranks, if you want to survive 2012, join us. Tell Jim Webb, Joe Manchin, Ben Nelson and Florida Bill Nelson, if you want to keep your job in 2012, vote with us. There was a time that Blue Dog Democrats were actually Blue Dog Democrats. For the past four years, Blue Dogs were like children, to be seen but not heard. Their job was to vote the way Nancy Pelosi told them and now many of them are ex-congressmen and ex-Senators. They did Pelosi and Reid bidding, only to find themselves sacrificed for the leftist agenda. Contrast the present generation of blue dogs to past blue dogs, in particular during the early portion of the Reagan era. At the beginning of the Reagan era, enough Democrat blue Dogs and moderates joined Republicans to pass the Reagan economic centerpiece bill that became the basis of three decades of solid economic growth.

There are times that call for clear choices and no echoes. This is that moment. If the Republicans can remember that little reality, they will set the stage for a 2012 victory. If they choose to be part of an echo chamber, Obama will win a second term.